211 CMR 66.00: SMALL GROUP HEALTH INSURANCE Section 66.01: Authority 66.02: Purpose 66.03: Applicability and Scope 66.04: Definitions 66.05: Minimum Coverage Standards 66.06: Renewability 66.07: Pre-existing Conditions and Waiting Periods 66.08: Restrictions Relating to Premium Rates 66.09: Submission and Review of Rate Filings 66.10: Eligibility Criteria: Exclusion/Limitation of Mandated Benefits in Health Benefit Plans 66.11: Connector Seal of Approval Plans 66.12: Disclosure 66.13: Health Plan Filing and Reporting Requirements 66.14: Severability 66.90: Appendix A: Actuarial Opinion 66.01: Authority 66.02: Purpose 211 CMR 66.00 is promulgated in accordance with the authority granted to the Commissioner of Insurance by M.G.L. chs. 175, 176A, 176B, 176D, 176G, 176I and 176J. 66.03: Applicability and Scope 66.04: Definitions The purpose of 211 CMR 66.00 is to implement the provisions of M.G.L. c. 176J. (1) 211 CMR 66.00 applies to all health benefit plans offered, made effective, issued, renewed, delivered or issued for delivery to any eligible small business or to any eligible individual under M.G.L. c. 176J on or after July 1, 2007 whether issued directly by a carrier, through the Connector, through an association, a group purchasing cooperative, or through an intermediary. (2) Nothing in 211 CMR 66.00 prohibits a carrier that offers health insurance to a business of more than 50 eligible employees from offering insurance in accordance with the provisions of 211 CMR 66.00. Actuarial Equivalence: refers to two health benefit plans that have the same Benefit Level Rate Adjustment factor. Actuarial Opinion: a signed written statement by a qualified member of the American Academy of Actuaries, as prescribed in 211 CMR 66.90: Appendix A, which certifies that the actuarial assumptions, methods and contract forms utilized by the carrier in establishing premium rates for small group health benefit plans comply with all the requirements of 211 CMR 66.00 and any other applicable law. Base Premium Rate: the midpoint rate within a modified community rate band for each rate basis type of each health benefit plan of a carrier. Benefit Level: the health benefits, including the benefit payment structure or service delivery and network, provided by a health benefit plan. Benefit Level Rate Adjustment: a number that represents the ratio of the actuarial value of the benefit level of one health benefit plan as compared to the actuarial value of the benefit level of another health benefit plan that is measured on the basis of a group census that is representative of Massachusetts small groups for that carrier. 4/1/11 211 CMR - 399
66.04: continued Carrier: an insurer licensed or otherwise authorized to transact accident and health insurance under M.G.L. c. 175; a nonprofit hospital service corporation organized under M.G.L. c. 176A; a non-profit medical service corporation organized under M.G.L. c. 176B; or a health maintenance organization organized under M.G.L. c. 176G. Class of Business: all or a distinct grouping of eligible insureds as shown on the records of the carrier which is provided with a health benefit plan through a health care delivery system operating under a license distinct from that of another grouping. For the purposes of 211 CMR 66.00, only the following three classes of business shall be recognized: persons covered through plans offered by health maintenance organizations licensed under M.G.L. c. 176G, persons covered through preferred provider plans approved under M.G.L. c. 176I and persons covered through other indemnity plans organized under M.G.L. chs. 175, 176A and 176B. Commissioner: the Commissioner of Insurance appointed pursuant to M.G.L. c. 26, 6. Connector: the Commonwealth Health Insurance Connector Authority created under M.G.L. c. 176Q. Connector Seal of Approval: the approval given by the Connector to indicate that a health benefit plan meets certain standards regarding quality and value. Creditable Coverage: coverage of an individual under any of the following health plans with no lapse of coverage of more than 63 days: (a) a group health plan; (b) a health plan, including, but not limited to, a health plan issued, renewed or delivered within or without the commonwealth to an individual who is enrolled in a qualifying student health insurance program under M.G.L. c. 15A, 18 or a qualifying student health program of another state; (c) Part A or Part B of Title XVIII of the Social Security Act; (d) Title XIX of the Social Security Act, other than coverage consisting solely of benefits under section 1928; (e) 10 U.S.C. 55; (f) a medical care program of the Indian Health Service or of a tribal organization; (g) a state health benefits risk pool; (h) a health plan offered under 5 U.S.C. 89; (i) a public health plan as defined in federal regulations authorized by the Public Health Service Act, section 2701(c)(I)(I), as amended by Public Law 104-191; (j) a health benefit plan under the Peace Corps Act, 22 U.S.C. 2504(e); (k) coverage for young adults as offered under M.G.L. c. 176J, 10; or (l) any other qualifying coverage required by the Health Insurance Portability and Accountability Act of 1996, as it is amended, or by regulations promulgated under that act. 211 CMR 66.04: Creditable Coverage applies to creditable coverage for portability as used in 211 CMR 66.00 in relation to any pre-existing condition provision or waiting period. It is not intended to define creditable coverage as it is defined by the Connector for purposes of determining individual responsibility for maintaining health coverage. Date of Enrollment: with respect to an individual covered under a group health plan or health insurance coverage, the date of enrollment of the individual in the plan or coverage or, if earlier, the first day of the waiting period for such enrollment. Eligible Dependent: the spouse or child of an eligible individual or eligible employee, subject to the applicable terms of the health benefit plan covering such individual or employee. Eligible Employee: an employee who: (a) works on a full-time basis with a normal work week of 30 or more hours, and includes an owner, a sole proprietor or a partner of a partnership; provided however, that such owner, sole proprietor or partner is included as an employee under a health care plan of an eligible small business; and provided, however, that eligible employee does not 4/1/11 211 CMR - 400
include an employee who works on a temporary or substitute basis; and 4/1/11 211 CMR - 401
66.04: continued (b) is hired to work for a period of not less than five months, provided, however, that a carrier cannot require that a person must have worked for an unreasonable length of time in order to qualify as an eligible employee. For the purposes of 211 CMR 66.00, five months shall be deemed to be an unreasonable length of time when determining eligible employee. Eligible Individual: an individual who is a resident of the commonwealth and who is not seeking individual coverage to replace an employer-sponsored health plan for which the individual is eligible and which provides coverage that is at least actuarially equivalent to minimum creditable coverage as defined by Connector regulation 956 CMR 5.00. For the purposes of 211 CMR 66.00, continuation coverage under M.G.L. c. 176J, 9 or under the Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA), shall not be considered an employer-sponsored health plan. Eligible Small Business or Group: any sole proprietorship, firm, corporation, partnership or association actively engaged in business who, on at least 50% of its working days during the preceding year, employed from among one to not more than 50 eligible employees, the majority of whom worked in Massachusetts; provided, however, that the sole proprietorship, firm, corporation, partnership or association need not have been in existence during the preceding year in order to qualify as an eligible small business or group. A business shall be considered to be one eligible small business or group if: (a) it is eligible to file a combined tax return for purpose of state taxation; or (b) its companies are affiliated companies through the same corporate parent. Except as otherwise specifically provided, provisions of 211 CMR 66.00 which apply to an eligible small business will continue to apply through the end of the rating period in which an eligible small business no longer meets the requirements of eligible small business or group. An eligible small business that exists within a MEWA shall be subject to 211 CMR 66.00. Emergency Services: services to treat a medical condition, whether physical or mental, manifesting itself by symptoms of sufficient severity, including severe pain, that the absence of prompt medical attention could reasonably be expected by a prudent layperson who possesses an average knowledge of health and medicine, to result in placing the health of an insured or another person in serious jeopardy, serious impairment to body function, or serious dysfunction of any body organ or part, or, with respect to a pregnant woman, as further defined in section 1867(e)(1)(B) of the Social Security Act, 42 U.S.C. 1395dd(e)(1)(B). Financial Impairment: a condition in which, based on the overall condition of the carrier as determined by the commissioner, the carrier is, or if subjected to the provisions of 211 CMR 66.00 could reasonably be expected to be, insolvent, or otherwise in an unsound financial condition such as to render its further transactions of business hazardous to the public or its policyholders or members, or is compelled to compromise, or attempt to compromise, with its creditors or claimants on the grounds that it is financially unable to pay its claims. Group Average Premium Rates: a set of numbers, one for each rate basis type, where each number is the total of the premiums charged to an eligible small business for all eligible employees and eligible dependents or eligible individuals and their dependents of that rate basis type, divided by the number of insured eligible employees of that rate basis type. Group Base Premium Rates: the group average premium rates that would be charged by a carrier at the beginning of the rating period if the premiums were based solely upon the age, industry, participation rate, wellness program usage, tobacco usage and rate basis type of the members of the group. The group base premium rates for every group will be adjusted to a January 1 st basis by dividing each group base premium rate by a deflator. The deflator equals the sum of trend for that carrier and the number one, raised to the power of the fraction of the calendar year which has elapsed at the time the new rating period begins. 4/1/11 211 CMR - 402
66.04: continued Group Health Plan: (a) An employee welfare benefit plan, as defined in section 3(1) of the Employee Retirement Income Security Act of 1974, 29 U.S.C. 1002, to the extent that the plan provides medical care, and including items and services paid for as medical care to employees or their dependents, as defined under the terms of the plan directly or through insurance, reimbursement or otherwise. For the purposes of 211 CMR 66.00, medical care means amounts paid for: 1. the diagnosis, cure, mitigation, treatment or prevention of disease, or amounts paid for the purpose of affecting any structure or function of the body; 2. amounts paid for transportation primarily for and essential to medical care referred to in 211 CMR 66.04: Group Health Plan(a)1.; and 3. amounts paid for insurance covering medical care referred to in 211 CMR 66.04: Group Health Plan(a)1. and 2. (b) Any plan, fund or program which would not be, but for section 2721(e) of the federal Public Health Service Act, an employee welfare benefit plan, and which is established or maintained by a partnership, to the extent that the plan, fund or program provides medical care, including items and services paid for as medical care, to present or former partners in the partnership, or to their dependents, as defined under the terms of the plan, fund or program, directly or through insurance, reimbursement or otherwise, shall be treated, subject to 211 CMR 66.04: Group Health Plan(c), as an employee welfare benefit plan which is a group health plan. (c) In a group health plan, the term employer also includes the partnership in relation to any partner; and (d) the term participant also includes: 1. in connection with a group health plan maintained by a partnership, an individual who is a partner of the partnership; or 2. in connection with a group health plan maintained by a self-employed individual, under which one or more employees are participants, the self-employed individual if that individual is, or may become, eligible to receive a benefit under the plan or that individual s beneficiaries may be eligible to receive any benefit. Health Benefit Plan: Any individual, general, blanket or group policy of health, accident and sickness insurance issued by an insurer licensed under M.G.L. c. 175; an individual or group hospital service plan issued by a non-profit hospital service corporation under M.G.L. c. 176A; an individual or group medical service plan issued by a nonprofit medical service corporation under M.G.L. c. 176B; and an individual or group health maintenance contract issued by a health maintenance organization under M.G.L. c. 176G. Health benefit plans shall not include those plans whose benefits are for: (a) accident only; (b) credit only; (c) limited scope vision or dental benefits if offered separately; (d) hospital indemnity insurance policies if offered as independent, non-coordinated benefits which for the purposes of 211 CMR 66.00 shall mean policies issued under M.G.L. c. 175 which provide a benefit not to exceed $500 per day, as adjusted on an annual basis by the amount of increase in the average weekly wages in the commonwealth as defined in M.G.L. c. 152, 1, to be paid to an insured or a dependent, including the spouse of an insured, on the basis of a hospitalization of the insured or a dependent; (e) disability income insurance; (f) coverage issued as a supplement to liability insurance; (g) specified disease insurance that is purchased as a supplement and not as a substitute for a health plan and meets the requirements of 211 CMR 146.00; (h) insurance arising out of a workers compensation law or similar law; (i) automobile medical payment insurance; (j) insurance under which benefits are payable with or without regard to fault and which is statutorily required to be contained in a liability insurance policy or equivalent self insurance; (k) long-term care if offered separately; (l) coverage supplemental to the coverage provided under 10 U.S.C. 55 if offered as a separate insurance policy; 4/1/11 211 CMR - 403
66.04: continued (m) any policy subject to M.G.L. c. 176K or any similar policies issued on a group basis, Medicare Advantage plans or Medicare Prescription drug plans; or (n) a health plan issued, renewed or delivered within or without the commonwealth to an individual who is enrolled in a qualifying student health insurance program under M.G.L. c. 15A, 18 shall not be considered a health plan for the purposes of 211 CMR 66.00 and shall be governed by said M.G.L. c. 15A. Health Maintenance Organization or HMO: an entity licensed to do business in Massachusetts under M.G.L. c. 176G. Insured: any policyholder, certificate holder, subscriber, member or other person on whose behalf the carrier is obligated to pay for and/or provide health care services. Intermediary: a chamber of commerce, trade association, or other organization, formed for purposes other than obtaining insurance, which has complied with the requirements of 211 CMR 66.13(3), and which offers its members the option of purchasing a health benefit plan. Late Enrollee: an eligible employee or dependent who requests enrollment in an eligible small business' health insurance plan or insurance arrangement after the group's initial enrollment period, his or her initial eligibility date provided under the terms of the plan or arrangement, or the group's annual open enrollment period. Mandated Benefit: a health service or category of health service provider which a carrier is required by its licensing or other statute to include in its health benefit plan. Member: any person enrolled in a health benefit plan. MEWA or Multiple Employer Welfare Arrangement or Multiple Employer Trust either: (a) a fully-insured multiple employer welfare arrangement as defined in 3 and 514 of the Employee Retirement Income Security Act of 1974 (ERISA), 29 USC 1002 and 1144; or (b) an entity holding itself out to be a MEWA, multiple employer welfare arrangement or multiple employer trust that is not fully insured and, therefore, shall be required to be licensed under M.G.L. c. 175. An arrangement that constitutes a MEWA is considered a separate group health plan with respect to each employer maintaining the agreement. Modified Community Rate: a rate resulting from a rating methodology in which the premium for all persons within the same rate basis type who are covered under a health benefit plan is the same without regard to health status, but premiums may vary due to factors such as age, group size, industry, participation rate, geographic area, wellness program usage, tobacco usage, or benefit level for each rate basis type as permitted by M.G.L. c. 176J and 211 CMR 66.00. Office of Patient Protection: the office in the Department of Public Health established by M.G.L. c. 111, 217(a). Participation Rate: the percentage of eligible employees electing to participate in a health benefit plan out of all eligible employees, or the percentage of the sum of eligible employees and eligible dependents electing to participate in a health benefit plan out of the sum of all eligible employees and eligible dependents, at the election of the carrier. In either case, the numbers used to compute these percentages may not include any eligible employee or eligible dependent who does not participate in the eligible small business' health benefit plan, but who is enrolled in another health benefit plan as a spouse or dependent. Participation Requirement: a policy provision, or a carrier's underwriting guideline if there is no such policy provision, that requires that a group attain a certain participation rate in order for a carrier to accept the group for enrollment in the health benefit plan. For groups of five or fewer eligible persons, a carrier may require a participation rate not to exceed 100%. For groups of six or more eligible persons, a carrier may require a participation rate not to exceed 75%. 4/1/11 211 CMR - 404
66.04: continued Pre-existing Conditions Provision: with respect to coverage, a limitation or exclusion of benefits relating to a condition based on the fact that the condition was present before the date of enrollment for the coverage, whether or not any medical advice, diagnosis, care or treatment was recommended or received before the date. Genetic information shall not be treated as a condition in the absence of a diagnosis of the condition related to that information. Pregnancy shall not be a pre-existing condition. Eligible persons under age 19, including eligible individuals, eligible employees and eligible dependents, and Trade Act/HCTC eligible persons shall not be subject to any pre-existing conditions provision. Qualifying Health Plan: any blanket or general policy of medical, surgical or hospital insurance described in M.G.L. c. 175, 110(A), (C) or (D); policy of accident or sickness insurance as described in M.G.L. c. 175, 108 which provides hospital or surgical expense coverage; nongroup or group hospital or medical service plan issued by a non-profit hospital or medical service corporation under M.G.L. c. 176A and M.G.L. c. 176B; nongroup or group health maintenance contract issued by an HMO under M.G.L. c. 176G; nongroup or group preferred provider plan issued under M.G.L. c. 176I; self-insured or self-funded health plans offered by an employer or union health and welfare fund; health coverage provided to persons serving in the armed forces of the United States; or government-sponsored health coverage including, but not limited to Medicare and medical assistance provided under M.G.L. c. 118E. Rate Basis Type: each category of single or multi-party composition for which a carrier charges separate rates. For the purpose of 211 CMR 66.00, carriers shall use at least any combination of the following categories: (a) single; (b) two adults; (c) one adult and one or more children; and (d) two adults and one or more children. Nothing in 211 CMR 66.04: Rate Basis Type prohibits a carrier from establishing separate rates for active employees and retirees, or for Medicare-eligible insureds, or for any other categories to the extent otherwise required by state or federal law, such as persons for continued group health coverage under COBRA or M.G.L. c. 176J, 9. Carriers may offer any rate basis types, but rate basis types that are offered to any eligible small employer or eligible individual shall be offered to every eligible small employer or eligible individual for all coverage issued or renewed on or after July 1, 2007. Rating Factor: characteristics including, but not limited to, age, industry, rate basis type, geography, wellness program usage or tobacco usage. Rating Period: the period for which premium rates established by a carrier are in effect, as determined by the carrier. Resident: a natural person living in the commonwealth, but the confinement of a person in a nursing home, hospital or other institution shall not by itself be sufficient to qualify a person as a resident. Small Business Group Purchasing Cooperative or Group Purchasing Cooperative: a Massachusetts nonprofit or not-for-profit corporation or association, approved as a qualified association by the commissioner under M.G.L. c. 176J, 12, that has been certified by the commissioner as a group purchasing cooperative and which negotiates with one or more carriers for the issuance of health benefit plans that cover employees, and the employees' dependents, of qualified association's members. Tobacco Product: a product that contains tobacco in any of its forms, including, but not limited to, cigarettes, bidi cigarettes, clove cigarettes, cigars, pipe tobacco, smokeless tobacco, chewing tobacco, or snuff. 4/1/11 211 CMR - 405
66.04: continued Trade Act/HCTC-eligible Person: or TA/HCTC-eligible Person: any eligible trade adjustment assistance recipient or any eligible alternative trade adjustment assistance recipient as defined in section 35(c)(2) of section 201 of Title II of Public Law 107-210, or an eligible Pension Benefit Guarantee Corporation pension recipient who is at least 55 years old and who has qualified health coverage, does not have other specified coverage, and is not imprisoned, under Public Law 107-210. Trend: the annual change, from the first day of a group's prior rating period to the first day of that group's new rating period, in the average of all groups' base premium rates attributable to factors other than changes in benefit levels and rate basis types, adjusted for rating periods greater or lesser than one year. Waiting Period: a period immediately subsequent to the effective date of an insured's coverage under a health benefit plan during which the plan does not pay for some or all hospital or medical expenses, but in all cases pays for emergency services. Trade Act/HCTC-eligible persons shall not be subject to any waiting period. Wellness Program or Health Management Program: an organized system designed to improve the overall health of participants through activities that may include, but shall not be limited to, education, health risk assessment, lifestyle coaching, behavior modification and targeted disease management. 66.05: Minimum Coverage Standards (1) Offerings and Open Enrollment. (a) Unless otherwise provided in 211 CMR 66.05, every carrier shall make available to every eligible individual and every eligible small business a certificate that evidences coverage for every health benefit plan that it provides to any other eligible individual or eligible small business whether issued or renewed to a trust, association or other entity that is not a group health plan, as well as to their eligible dependents. Every carrier must accept for enrollment any eligible individual or eligible small business that seeks to enroll in a health benefit plan provided, however, that a carrier shall only contract to sell a health benefit plan to an eligible individual or eligible dependent during the annual mandatory open enrollment period of July 1 st to August 15 th, except as follows: 1. A carrier shall enroll an eligible individual, as defined in 2741 of the Health Insurance Portability and Accountability Act of 1996, 42 U.S.C. 300gg-41(b) ("HIPAA-eligible individual"), into a health plan if such individual requests coverage within 63 days of termination of any prior creditable coverage. 2. A carrier shall enroll an eligible individual into a health plan if such individual requests coverage within 63 days of experiencing a qualifying event. A carrier shall enroll the eligible dependent(s) of an eligible individual into a health plan if coverage is sought for the eligible dependent(s) within 30 days of a qualifying event. For the purposes of 211 CMR 66.05(1)(a)2., qualifying events shall include, but not be limited to: marriage, birth or adoption of a child, court-ordered care of a child, or any other event as may be designated by the commissioner. 3. A carrier shall enroll an eligible individual who has been granted a waiver by the Office of Patient Protection. (b) Coverage issued to eligible individuals under 211 CMR 66.05(1)(a) shall become effective on the first day of the month following receipt of a completed application, except for coverage issued pursuant to 211 CMR 66.05(1)(a)1. through 3. which shall become effective within 30 days of the carrier's receipt of a completed application or approved waiver form. For completed applications received in the last five days of a calendar month, carriers shall give eligible individuals the option of whether: 1. coverage will become effective as of the first day of the month following receipt of the completed application; or 2. coverage will become effective as of the first day of the second month following receipt of the completed application. Carriers shall notify applicants that opting to receive coverage effective the first day of the month following submission of a completed application may result in processing delays, including delays in the receipt of an identification card or entry into the carrier's enrollment system, if the carrier is 4/1/11 211 CMR - 406
unable to 4/1/11 211 CMR - 407
66.05: continued process the completed application by the first of the month. Coverage issued to small businesses under 211 CMR 66.05(1)(a) shall become effective within 30 days of a carrier's receipt of a completed application. Any coverage issued pursuant to 211 CMR 66.05(1)(a)1. through 3. to be effective in any month other than during the annual open enrollment period shall be for a term of less than one year ending July 31 st. (c) Upon the request of an eligible small business or eligible individual, a carrier shall provide that eligible small business or eligible individual with a sample of health benefit plans and prices and, upon request, a price for every health benefit plan that it makes available to any eligible small business or eligible individual. The carrier may satisfy such a request for information on health benefit plan offerings by referring the eligible small business or eligible individual to resources where the information can be accessed, including but not limited to, an internet website. The term internet website shall include intranet website and electronic mail or e-mail. The carrier must provide free of charge a paper copy of this information if the eligible small business or eligible individual requests such a paper copy. The carrier shall provide a toll-free telephone number for the insured to call with any questions or requests. (d) A carrier may only contract to sell any health benefit plan with an employer if said insurance is offered by that employer to all full-time employees who live in the commonwealth; provided, however, the employer shall not make a smaller health insurance premium contribution percentage amount to an employee than the employer makes to any other employee who receives an equal or greater total hourly or annual salary for each health benefit plan for all employees. Notwithstanding the foregoing, a carrier may sell, issue, market or deliver a health benefit plan to an employer that establishes separate contribution percentages for employees covered by collective bargaining agreements. (e) If a carrier is not accepting every new eligible small group or eligible individual, it may not accept any new eligible small groups or eligible individuals either directly, through an association or through an intermediary or through the Connector. However, if a carrier issued a health insurance product which is not available to eligible small groups or eligible individuals but is available to a group with 51 or more employees and the size of that group declined to 50 or fewer employees during the term of the policy, the carrier is not required to make that particular health insurance product available to eligible small groups or eligible individuals. (f) A carrier may deny an eligible individual or a group of five or fewer eligible employees enrollment in a health benefit plan unless the eligible individual or the group enrolls through an intermediary or through the Connector, provided that the carrier complies with all of the following requirements: 1. For eligible individuals and groups of five or fewer eligible employees, every carrier must make coverage available either directly or through an intermediary or through the Connector. 2. No carrier may require an eligible individual or a group of five or fewer eligible employees to join an intermediary if the intermediary has unreasonable barriers to membership, including, but not limited to, unreasonable fees or unreasonable membership requirements. If an eligible individual or a small group is precluded from joining an intermediary due to unreasonable membership barriers, the carrier must enroll the eligible individual or eligible small group directly. Nothing in 211 CMR 66.05(1)(f) shall prohibit a carrier from enrolling eligible individuals or eligible groups directly or through the Connector. 3. If an eligible individual or a group of five or fewer eligible employees elects to enroll through an intermediary or through the Connector, a carrier may not deny that group enrollment. 4. The carrier must implement the requirements in 211 CMR 66.05(1)(f) consistently, treating all similarly situated individuals or groups in a similar manner. 5. Any carrier that enrolls eligible individuals or eligible small businesses through an intermediary or through the Connector must comply with all provisions of 211 CMR 66.00. 6. Nothing in 211 CMR 66.05(1)(f) prohibits an eligible individual or an eligible small business with six to 50 employees from electing to enroll through an intermediary or through the Connector for coverage under a health benefit plan. 4/1/11 211 CMR - 408
66.05: continued 7. Nothing in 211 CMR 66.05(1)(f) permits a carrier to require an eligible small business with six to 50 employees to enroll through an intermediary or through the Connector for coverage under a health benefit plan. (g) A carrier may implement a policy for issuance of a health benefit plan to an eligible individual who has a demonstrated history of canceling his or her coverage under a health benefit plan with any carrier prior to the end of that eligible individual's contract renewal period, including, but not limited to, a policy that said eligible individual be required to pay a portion of his or her annual premium in advance, provided that said policy is submitted to the division for approval prior to implementation. A carrier is not required to issue a health benefit plan to an eligible individual or an eligible small business if the carrier can demonstrate to the satisfaction of the commissioner that within the prior 12 months: 1. the eligible individual or eligible small business has made at least three or more late payments in a 12 month period; or 2. the eligible individual or eligible small business has committed fraud, misrepresented the eligibility of an employee or of an individual, or misrepresented information necessary to determine group size, group participation rate, the group premium rate, or individual rate; or 3. the eligible individual or eligible small business has failed to comply in a material manner with a health benefit plan provision, including, failure to provide information necessary to determine eligibility, and, for an eligible small business, carrier requirements for employer group premium contributions; or 4. the eligible small business has been covered by three or more health benefit plans within the same class of business during the four years immediately preceding the date of application for coverage. However, nothing in 211 CMR 66.05(1)(g)4. may be used by a carrier to refuse acceptance of an eligible small business solely because the eligible small business offers multiple health benefit plans at the same time. (h) A carrier may request information from other carriers regarding the items listed in 211 CMR 66.05(1)(g) provided that the request does not violate any applicable state or federal law. The carrier receiving such a request from another carrier may provide the information consistent with state or federal law. (i) A carrier is not required to issue a health benefit plan to an eligible small business or eligible individual if the eligible small business or eligible individual fails to comply with reasonable requests by the carrier for information necessary to verify the application for coverage, including but not limited to information regarding the prior health insurance coverage of the eligible small business or eligible individual. Requests for information may also include information reasonably necessary for the carrier to determine whether the small business is an eligible small business or whether a person is an eligible employee or an eligible individual as defined in 211 CMR 66.04. (j) A carrier is not required to issue a health benefit plan to an eligible small business if the carrier can demonstrate, to the satisfaction of the commissioner, that the small business fails at the time of issuance or renewal to meet a participation rate requirement established under the definition of participation rate, as defined in 211 CMR 66.04. However, if an eligible business does not meet a carrier s minimum participation rate requirement, the carrier may separately rate each employee as an eligible individual. (k) A carrier is not required to issue a health benefit plan to an eligible individual or eligible small business if acceptance of an application or applications would create for the carrier a condition of financial impairment. The carrier must file with the commissioner at least 30 days in advance of any such denial, or as soon as the carrier s financial position becomes known to the carrier, a certified statement by the Chief Financial Officer attesting to the carrier's overall financial impairment and accompanied by supporting documentation. Any carrier found to be financially impaired by the commissioner must immediately cease issuing health benefit plans on an initial basis to eligible individuals and eligible small businesses in accordance with the provisions of 211 CMR 66.05(3). (l) Every carrier must apply participation and employer contribution requirements in a uniform manner to all groups of the same size. Carriers may not increase participation or employer contribution requirements where the size of the group has changed until the group s renewal date of the health benefit plan. (m) Any carrier who denies coverage to an eligible small business or eligible individual 4/1/11 211 CMR - 409
under the provisions of 211 CMR 66.05 must: 4/1/11 211 CMR - 410
66.05: continued 1. provide to the small business or eligible individual, in writing, the specific reason(s) for the denial of coverage; and 2. make available to the commissioner, upon request, the documentation for the denial. (n) An HMO is not required to accept applications from or offer coverage: 1. to an eligible individual or an eligible small group, where the eligible individual or eligible small group is not physically located in the HMO's approved service area; or 2. within an area, where the HMO reasonably anticipates, and receives prior approval by demonstrating to the satisfaction of the commissioner, that it will not, within that area, have the capacity in its network of providers to deliver services adequately to the members because of its obligations to existing contract holders and enrollees. The HMO may not offer coverage in that area to any new cases of individuals or business groups of any size until the later of 90 days after each refusal or the date on which the carrier notifies the commissioner that it has regained capacity to deliver services to eligible small business groups. (o) A carrier that offers a health benefit plan that: 1. provides or arranges for the delivery of health care services through a closed network of health care providers; and 2. has reported in its annual membership filing that as of the close of the preceding calendar year that a combined total of 5,000 or more eligible individuals, eligible employees and eligible dependents, were enrolled in health benefit plans sold, issued, delivered, made effective or renewed by the carrier to eligible small businesses or eligible individuals, shall, by no later than September 1 st of that year, offer to all eligible individual and small businesses in at least one geographic area at least one plan with either a reduced or selective network of providers or a plan in which providers are tiered and member cost sharing is based on the tier placement that meets the standards of 211 CMR 152.04. The goal is for these plans to be available throughout the commonwealth. For the purpose of 211 CMR 66.05(1)(o)2., "geographic area" shall mean the largest metropolitan region in a carrier's service area, subject to the approval of the commissioner. A carrier may use a plan containing multiple networks to meet the geographic area standard described in 211 CMR 66.05(1)(o)2. The benefit rate adjustment factor of this plan will be such that this plan's group base premium shall be at least 12% lower than the group base premium of the carrier's most actuarially similar plan with a non-selective or non-tiered network of providers (a "32A Plan"). On and after January 1, 2012, carriers shall only classify or reclassify providers in a carrier's 32A Plan by benefit level tiers based on quality performance as measured by the standard quality measure set and by cost performance as measured by health status adjusted total medical prices and relative prices. When applicable quality measures are not available, a carrier shall tier providers either solely on adjusted total medical expenses or relative prices or both. 3. A carrier may delay implementation of its 32A Plan as set forth in 211 CMR 66.05(1)(o)2. if the carrier applies for and obtains written approval from the commissioner by no later than May 1 st of the year in which the carrier is first required to offer a 32A plan. (p) A carrier that offers a health benefit plan that has reported in its annual membership filing that as of the close of the preceding calendar year that a combined total of 5,000 or more eligible individuals, eligible employees and eligible dependents, were enrolled in health benefit plans sold, issued, delivered, made effective or renewed by the carrier to eligible small businesses or eligible individuals, shall be required, as a condition of continued offer of coverage to eligible small employers and eligible individuals outside of group purchasing cooperatives, to respond to all documents from certified group purchasing cooperatives requesting submission of product and rate proposals for offer by the group purchasing cooperative to eligible members of the qualified associations. The responses will be submitted to the group purchasing cooperatives in a timely and complete manner. (2) Eligible Employees, Eligible Individuals and Eligible Dependents. (a) Every carrier must provide coverage to all eligible employees, all eligible individuals, and all eligible dependents except: 4/1/11 211 CMR - 411
1. in the case of an HMO, where the eligible employee or eligible individual or eligible dependent does not meet the HMO's requirements regarding residence or employment within the HMO's approved service area; 4/1/11 211 CMR - 412
66.05: continued 2. in the case of a small group when an eligible employee seeks to enroll in a health benefit plan significantly later than it was initially eligible to enroll. However, an eligible employee or dependent will not be considered a late enrollee if the individual requests enrollment within 30 days after termination of a previous qualifying health plan, and a. the employee or dependent was covered under a previous qualifying health plan at the time of the initial eligibility for the eligible small business' health benefit plan; or b. the employee or dependent lost coverage under the previous qualifying health plan as a result of the termination of his or her spouse's employment or eligibility, death of a spouse, divorce, loss of dependent status or the involuntary termination of the qualifying previous coverage; or c. a court has ordered coverage be provided for a spouse, former spouse, minor or dependent child under a covered employee's health benefit plan and request for enrollment is made within 30 days after issuance of the court order; or d. the loss of prior coverage was due to the insolvency of the former carrier. (b) A carrier that does not provide coverage to a late entrant because an eligible employee or eligible dependent did not meet the conditions of 211 CMR 66.05(2)(a)2.a. through d., must make coverage available to that person at the group's next renewal date and may not deny that person coverage at the next renewal date except for reasons otherwise allowed by 211 CMR 66.00. (c) A carrier may not require that a person must have worked for an unreasonable length of time in order to qualify as an eligible employee. For the purposes of 211 CMR 66.00, five months is considered to be an unreasonable length of time when determining employee eligibility. (d) Nothing in 211 CMR 66.00 shall prohibit a carrier from offering coverage in a group to a person, and his dependents, who does not satisfy the hours per week or period employed portions of the definition of eligible employee provided that the carrier applies these standards consistently to all such persons and their dependents who do not meet the definition of an eligible employee. (e) Nothing in 211 CMR 66.00 shall prohibit a carrier from offering coverage to an eligible individual or eligible dependent who seeks coverage pursuant to 211 CMR 66.05(1)(a)1. through 3. (3) Discontinuance Provisions. (a) Filing Requirements. Notwithstanding any other provision in 211 CMR 66.05, a carrier may deny an eligible individual or eligible small group enrollment in a health benefit plan if the carrier certifies to the commissioner that the carrier intends to discontinue selling that health benefit plan to new eligible individuals and eligible small businesses. (b) Material to Be Submitted. A carrier that intends to discontinue selling a health benefit plan to new eligible individuals and eligible small businesses must, at least 30 days in advance of discontinuing the sale of the health benefit plan, submit to the commissioner a statement certified by an officer of the carrier that specifies all of the following: 1. The date by which it will discontinue selling the health benefit plan to all new individuals and groups. 2. The reason(s) for the discontinuance of the health benefit plan. 3. A list of any other health benefit plans it continues to sell in Massachusetts. 4. The number of groups and individuals covered by the discontinued health benefit plan, both in Massachusetts and in its total book of business. 5. An acknowledgment that the carrier is prohibited from selling the particular health benefit plan again in Massachusetts to new individuals and groups for a period of not less than three years. (c) The commissioner may disapprove, within 21 days of receiving notice under 211 CMR 66.05(3)(b), a carrier s election to discontinue the sale of the health benefit plan if the carrier fails to comply with 211 CMR 66.05(3)(b) or is in violation of 211 CMR 66.05(4). (d) Notwithstanding any other provision in 211 CMR 66.05, carriers are required to renew coverage, as described in 211 CMR 66.06, under an otherwise discontinued health 4/1/11 211 CMR - 413
benefit plan for existing groups. (4) In no event may a carrier deny an eligible individual or eligible small group enrollment in a health benefit plan as part of an effort to circumvent the intent of M.G.L. c. 176J. 4/1/11 211 CMR - 414
66.06: Renewability (1) Except as provided in 211 CMR 66.06(2), every health benefit plan shall be renewable as required by the Health Insurance Portability and Accountability Act of 1996. (2) A carrier is not required to renew the health benefit plan of an eligible small business if the small business: (a) has not paid the required premiums; or, (b) has committed fraud, misrepresented whether a person is an eligible employee, or misrepresented information necessary to determine the size of a group, the participation rate of a group, or the premium rate for a group; or (c) failed to comply in a material manner with health benefit plan provisions, including carrier requirements regarding employer contributions to group premiums; or (d) fails, at the time of renewal, to satisfy the definition of an eligible small business or meet the participation requirements of the health benefit plan; or, (e) fails to comply with reasonable requests to verify the information described in 211 CMR 66.05(1)(g); or (f) is not actively engaged in business. (3) A carrier is not required to renew the health benefit plan of an eligible individual, eligible employee, or eligible dependent if said person: (a) has not paid the required premiums; (b) has committed fraud or misrepresented whether he or she qualifies as an eligible individual, eligible employee, eligible dependent, or misrepresented information necessary to determine his or her eligibility for a health benefit plan or for specific health benefits; (c) has failed to comply in a material way with the provisions of the health benefit plan, the member contract or the subscriber agreement, including but not limited to relocation of the individual, employee, or dependent, outside the service area of the carrier; (d) fails, at the time of renewal, to satisfy the definition of an eligible individual, eligible employee, or eligible dependent, provided that the carrier collects sufficient information to make such a determination and makes such information available to the commissioner upon request; (e) has failed to comply with the carrier s reasonable request for information in an application for coverage. (4) A carrier must file with the commissioner any material changes in the criteria it uses under 211 CMR 66.06(2) and/or 211 CMR 66.06(3) to determine the nonrenewability of a health benefit plan for an eligible small business as part of the annual filing required by 211 CMR 66.13. (5) A carrier must provide at least 60 days prior notice to an eligible individual or eligible small business of the carrier's intention not to renew that eligible individual or eligible small business's health benefit plan and the specific reason(s) for the nonrenewal in accordance with the carrier's filed criteria. A carrier must provide at least 90 days prior notice to affected eligible individuals or eligible small businesses of the carrier's intention to discontinue offering a particular type of health benefit plan. (6) A carrier that elects to nonrenew all of its health benefit plans delivered or issued for delivery to eligible individuals and eligible small businesses in Massachusetts: (a) must submit to the commissioner, 30 days in advance of providing notice required under 211 CMR 66.06(6)(c) a statement certified by an officer of the carrier that specifies: 1. The date by which it will nonrenew all of its health benefit plans to all new groups; 2. The reason(s) for the nonrenewal of all health benefit plans; 3. The number of groups and individuals covered by the nonrenewed health benefit plans, both in Massachusetts and in its total book of business; and 4. An acknowledgment that the carrier is prohibited from writing new business in the individual and small group market in Massachusetts for a period of five years from the date of notice to the commissioner. (b) The commissioner may disapprove, within 21 days of receiving notice under 211 4/1/11 211 CMR - 415
CMR 66.06(6)(a), a carrier s election to nonrenew if the carrier fails to comply with 211 CMR 66.06(6)(a) or is in violation of 211 CMR 66.06(8). 4/1/11 211 CMR - 416
66.06: continued (c) A carrier must provide notice of the decision not to renew coverage to all affected eligible individuals or eligible small businesses at least 180 days prior to the nonrenewal of any health benefit plan by the carrier in the event the commissioner has not disapproved the carrier s election to nonrenew; and (d) after the 180 day notification period, must nonrenew coverage to eligible individuals or eligible small businesses only on the date of renewal for each individual or small business. (7) Nothing in 211 CMR 66.06 prohibits a carrier from canceling during the term of the policy a health benefit plan issued to an eligible individual or eligible small business for the reasons outlined in 211 CMR 66.06(2)(a), (b), (c) or (f) or in 211 CMR 66.06(3)(a), (b), or (c); provided that if the carrier cancels the health benefit plan for the reason found in 211 CMR 66.06(2)(a) or in 211 CMR 66.06(3)(a) during the policy term, a carrier must provide the eligible individual or eligible small business with any grace period as provided in the group's health benefit plan, including any prior notification requirements. (8) In no event may a carrier deny an eligible individual or eligible small group renewal of a health benefit plan as part of an effort to circumvent the intent of M.G.L. c. 176J. (9) In no event shall a carrier deny an eligible individual renewal of a health benefit plan, except as permitted in 211 CMR 66.06(3), provided, however, that any eligible individual whose policy was issued outside of the annual open enrollment described in 211 CMR 66.05(1) who seeks to renew that policy must renew during the next open enrollment period. (10) If a carrier re-verifies the eligibility of renewing individuals or small businesses, it shall complete the re-verification at least 90 days prior to renewal. 66.07: Pre-existing Conditions and Waiting Periods (1) No carrier may exclude any eligible individual, eligible employee, or eligible dependent from a health benefit plan on the basis of age, occupation, actual or expected health condition, claims experience, duration of coverage, or medical condition. (2) No carrier may modify the coverage of an eligible individual, eligible employee, or eligible dependent through riders or endorsements, or otherwise restrict or exclude coverage for certain diseases or medical conditions otherwise covered by the health benefit plan except as permitted under 211 CMR 66.00. (3) No health benefit plan issued to eligible persons aged 19 and over, including eligible individuals, eligible employees, or eligible dependents, may include pre-existing condition provisions that exclude coverage for a period beyond six months following the eligible individual's, eligible employee's, or eligible dependent's date of enrollment. The pre-existing condition provision shall only relate to a limitation or exclusion of benefits relating to a condition based on the fact that the condition was present before the date of enrollment for such coverage and for which any medical advice, diagnosis, care or treatment was recommended or received during the six months before the eligible individual's, eligible employee's, or eligible dependent's date of enrollment. Pregnancy shall not be a pre-existing condition. (4) No health benefit plan may include waiting periods that exclude coverage for a period beyond four months following the eligible individual's, eligible employee s, or eligible dependent s date of enrollment. Notwithstanding 211 CMR 66.07(4), no waiting period may be imposed if an eligible individual, eligible employee, or eligible dependent lacked creditable coverage for 18 months or more immediately prior to the date of enrollment. (5) When a eligible individual or eligible small group changes from one health benefit plan to another, whether such health benefit plan is with the same carrier or a different carrier, the carrier may impose a new waiting period of not more than four months on the eligible individual or on all members of the eligible small group for only those services covered under the new health benefit plan that were not covered under the old health benefit plan. 4/1/11 211 CMR - 417
66.07: continued (6) With respect to TA/HCTC-eligible persons, a carrier may not impose any pre-existing condition exclusion or waiting period following the TA/HCTC-eligible person s date of enrollment. (7) In determining whether a pre-existing condition provision or waiting period applies to an eligible individual, eligible employee, or eligible dependent, all health benefit plans must credit the time the person was covered under prior creditable coverage if the prior creditable coverage was continuous to a date not more than 63 days prior to the request for new coverage, exclusive of any applicable services waiting period under the new coverage, provided that the prior creditable coverage was reasonably actuarially equivalent to the new coverage. For the purpose of 211 CMR 66.07(6), reasonably actuarially equivalent means the following: (a) the Benefit Level Rate Adjustment factor for the new health benefit plan is no more than ten percentage points greater than the Benefit Level Rate Adjustment factor of the previous health benefit plan; provided, however, that if the Benefit Level Rate Adjustment factor for the new health benefit plan is more than ten percentage points greater than the Benefit Level Rate Adjustment factor of the previous health benefit plan, the eligible individual, eligible employee, or eligible dependent must receive at least the actuarially equivalent benefits of the previous health benefit plan during the term of the preexisting condition period or waiting period; or (b) if the previous coverage is under Medicare or Medicaid, or the individual seeking coverage is an eligible individual as defined in 211 CMR 66.05(1)(a)1., the previous coverage is presumed to be reasonably actuarially equivalent to the new health benefit plan. Notwithstanding 211 CMR 66.07(7), a carrier shall not impose on a HIPAA-eligible individual the requirement that said individual's prior creditable coverage be reasonably actuarially equivalent to that individual's new coverage. (8) If a health benefit plan includes a waiting period, emergency services must be covered during the waiting period. (9) A carrier may only impose either a pre-existing condition limitation or a waiting period; however no pre-existing condition limitation shall be imposed on an eligible person under age 19, including an eligible individual, eligible employee, or eligible dependent. 66.08: Restrictions Relating to Premium Rates Premiums charged to eligible small groups and eligible individuals, excluding eligible small groups within a group purchasing cooperative, shall be based on the collective experience of the covered small groups and individuals enrolled outside group purchasing cooperatives. Premiums charged to eligible small groups within a group purchasing cooperative will be based on premiums available outside of all cooperatives, adjusted by that group purchasing cooperative's specific group purchasing cooperative adjustment factor. Premiums charged to every eligible small business or eligible individual for a health benefit plan issued or renewed on or after July 1, 2007, whether through a trust or association or through an intermediary or group purchasing cooperative, or through the Connector, or directly, also must satisfy the following requirements: (1) The Premium Band for Group Base Premium Rates. (a) For every health benefit plan issued or renewed to an eligible small group or eligible individual on or after July 1, 2011, the group base premium rates charged by a carrier to each eligible small group or eligible individual outside all group purchasing cooperatives during a rating period may not exceed two times the group base premium rate which could be charged by that carrier to the eligible small group or eligible individual outside all group purchasing cooperatives with the lowest group base premium rate for that rate basis type within that class of business in that group s or individual s geographic area. (b) The group base premium rates charged by a carrier to each eligible small group within any group purchasing cooperative during a rating period may not exceed two times the group base premium rate which could be charged by that carrier to the eligible small group within that group purchasing cooperative with the lowest group base premium rate 4/1/11 211 CMR - 418